English county council blasted for 'inept project management' in delayed SAP replacement
- Reference: 1644485405
- News link: https://www.theregister.co.uk/2022/02/10/surrey_county_council_sap_erp/
- Source link:
Resources and Performance Select Committee chairman Steven McCormick told a council meeting the public body was mismanaging taxpayers' money by overpaying £3.2m on a new Unit4-based SaaS system to support payroll, HR, finance and procurement functions.
At a budget meeting yesterday, he said: "This is an inexcusable waste of public money, wholly avoidable with proper planning and competent implementation."
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Earlier this month The Reg [2]revealed the council had incurred the additional costs on the project as the go-live date was reset for April 2022.
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The southeast England council had planned to go live with the new system in December 2021.
Surrey councillor and resources committee member McCormick said: "There has been at least four months delay, with continuing risk and extra cost to the Surrey council taxpayer of £3.2 million. That is inept project management, despite a clear warning."
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A meeting in January heard that problems with the project to replace an SAP R/3 system - dating back to 2004 - with a SaaS application were known in June but not discussed with key council committees until after September. In April and June last year, new requirements from the HR department continued to arrive after the main software build was complete.
The application supplier assured the southern-England council these changes could be accommodated within the original project timeline, but by September it became clear it wasn't going to make that December 2021 launch date, the Resources and Performance Select Committee meeting heard [6]late last month .
The project delay created additional support costs from the incumbent supplier. The original business case pointed out that it would need to "provide notice to SAP by September 2021 to end support & maintenance contract by January 2022" or negotiate a contract extension with the supplier of the legacy system.
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That contract was re-negotiated and extended in October, at a £700k additional cost to the council.
[8]Team behind delayed ERP project was aware of problems but didn't inform Surrey County Council for months
[9]Another day, another ERP project behind schedule: This time it's Norfolk County Council and an Oracle system
[10]West Sussex County Council faces two-year delay to replace ageing SAP system for Oracle
[11]UK government puts £5bn on the table in trawl for public sector networks services
The Unit4 contract got off to an inauspicious start when it was erroneously [12]advertised as a £40m deal in January, which the council was later [13]forced to correct .
As it planned the procurement the council docs said: "The existing server hardware has reached end of life and is on expensive extended support, with costs increasing every year."
While the existing system is nearly 18 years old, it has been re-platformed several times in an effort to save the council money running it.
Criticism of the Conservative-party-led council from the Residents' Association and Independent Group came at a Budget Meeting on Tuesday. The meeting refused to back calls to use £150m reserves to spend more on public health and avoid a £77 rise in annual council tax bills. ®
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[1] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YgTwXSNjkUULDFvFT3k2MQAAAJU&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[2] https://www.theregister.com/2022/01/10/surrey_county_council_3m_unit4/
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YgTwXSNjkUULDFvFT3k2MQAAAJU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[4] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YgTwXSNjkUULDFvFT3k2MQAAAJU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
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[6] https://www.theregister.com/2022/01/24/surrey_erp_project_problems/
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YgTwXSNjkUULDFvFT3k2MQAAAJU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[8] https://www.theregister.com/2022/01/24/surrey_erp_project_problems/
[9] https://www.theregister.com/2022/01/11/norfolk_county_council_oracle_delay/
[10] https://www.theregister.com/2021/12/14/west_sussex_county_council_faces/
[11] https://www.theregister.com/2021/10/21/uk_government_put_5bn_on/
[12] https://www.theregister.com/2020/10/06/surrey_county_council_erp_replacement/
[13] https://ted.europa.eu/udl?uri=TED:NOTICE:037728-2020:TEXT:EN:HTML
[14] https://whitepapers.theregister.com/
Re: 4m costs £3.2m ?
Well, it depends on why the costs grew. A company I worked for bid a job and the bid team was told in no uncertain terms that it was a "must win" project - more for pride that any other good reason. We won the job at a price well below that which we could make money at, and that was even assuming it was managed well on both our and the client side. It was well into the red at the project kick off meeting.
That's hardly the same problem. The company decided to lose money. It can be strategically justified.
The council did not actually choose to lose money.
Of course it was incompetent, but hey, it's a council, not private business.
Conservative.
"I don't see where the money is being spent."
It's not - probably. They don't have to "earn" it, so why take any actual responsibility for spending it; and why on Earth would they spend public money on pragmatically and visibly improving things for the actual public anyway. The finance bods are probably hoarding it or, similar to the Iceland fiasco, "investing" it into dodgy schemes because everyone wants to be a hot shot hedge fund manager right? And to gain those bragging rights down the golf club.
"The application supplier assured the southern-England council these changes could be accommodated"
Okay, point 1 : the application supplier lied. What a surprise.
Point 2 : the application supplier mismanaged the project. Everybody knows that you accept a project on a given list of points. Anything else is punted on to the v1.1 to-do list.
Well, if you know how to run a project, that is.
And to also remember that this is just getting tyhe data into this cloud service. At some point after the contract expires it has to come out again and migrate elsewhere. One hopes that project management will run better...
Maybe now's the time to get started on that.
Perhaps they should have told HR to boot itself out and replace itself with one that could competently work out what it needed.
Still reinventing the wheel from scratch
What I find incredible is how all these councils, hospitals, etc keep re-inventing the same wheel over and over again. Creating a new ERP implementation for a council should be as easy as: (1) find the council with a working ERP implementation that has the closest business processes and rules as your own (2) get that council source code and parametrization and isntall a fresh instance (3) change your instance to comply where your requirements are different (4) everyone wins: council gets a much quicker implementation and saves taxpayer money.
On second thought, I see two problems with this approach: if there is nobody yet at step (1) you don't have anything to start from and you are then not re-inventing but inventing. But there should be at least one, right? And yes, you could save a lot of money on external suppliers. Which is not good for external suppliers. So no, not everyone wins.
4m costs £3.2m ?
Really?
If any project I was on accumulated that sort of extra cost (as a %) for another 4 months - 18 weeks of work - i'd expect to be out the door pronto with a size 9 bootprint on my arse.
But, of course we all know that county officials don't seem to have a personal cost to their decisions.
I actually live in Surrey, and the investments in things like ... roads... in my part of it has definitely gone downhill (I'm a stones throw from Virginia Water - massive houses round there - Mansion et al, and a few Ruski oligarchs) . For what is probably the richest, or certainly one of, county in England - I don't see where the money is being spent.